Trade, climate change and fisheries: Building resilience through trade-policy reform

15 December 2009

The fisheries sector provides a source of direct and indirect employment for some 200 million people worldwide. It also plays a crucial role in advancing food security, accounting for a large source of per capita animal protein intake in many coastal areas. Overexploitation of fish stocks, however, is threatening the survival of this industry in many countries, a problem likely to be exacerbated by the effects of climate change. In order to make fisheries resilient to these challenges, countries need to advance policy reform on a number of fronts, including trade policies. Appropriately designed trade rules can discourage economically unviable and environmentally damaging fishing practices, support supply side capacity in developing countries, and allow sufficient policy space to support adaptation to climate change.

The impact of climate change on fisheries

The effects of climate change on fisheries are complex, and are likely to be different depending on the region, the species, and the state of the stocks. Some research indicates that the impacts will be greater on coastal species than on those living in mid-water or close to the surface, and on temperate rather than on tropical species. Global warming will also lead to migration of species in many regions. These changes may alter current patterns of production and trade in fisheries with potential gains in certain regions and losses in others.

Studies also show that fisheries in Small Island Developing States (SIDS) as well as many Least Developed Countries (LDCs) and Small and Vulnerable Economies (SVEs) are particularly vulnerable.[1] These countries tend to have a high degree of dependency on fisheries, with the sector constituting a large source of employment, export revenue and food security. Moreover, these countries are highly exposed to environmental hazards linked to climate change, and have limited adaptive capacities due to widespread poverty and the small size of their economies. Finally, developing countries' fisheries are usually dominated by small-scale and artisanal actors, who have limited resources and capacities to adapt to unforeseen events that may result from climate change.

How can trade policies help?

One key area in which trade policy reform can address the problem of over fishing relates to fisheries subsidies. There is an ongoing effort at the World Trade Organization (WTO) to discipline fisheries subsidies that lead to overcapacity and overfishing, taking into account the importance of this industry and its development potential in developing countries. The extensive use of certain fisheries subsidies in developed countries, such as fuel tax exemptions for fishing vessels provided in the EU, can make it profitable for fishermen to overfish depleted stocks. These subsidies also threaten the viability and competitiveness of the fisheries sector in developing countries (while developing countries also provide fisheries subsidies, their scale is much lower than those provided by developed countries). At the same time, however, certain subsidies can help conservation efforts, or aid vulnerable communities adapt to climate change. WTO disciplines, therefore, need to allow for subsidies that address the stresses facing the fisheries sector, especially as it impacts poor and vulnerable communities, while eliminating subsidies that contribute to unsustainable fishing practices.

More broadly, it is important that developing countries that are currently highly dependent on the fisheries sector are able to move up the value chain, while at the same diversifying their economies beyond the fisheries sector. However, certain trade measures such as technical barriers to trade (TBT) and sanitary and phytosanitary measures (SPS) frustrate efforts to enhance diversification of production and exports of high value-added processed fisheries products in developing countries. SPS and TBT measures are often intended to safeguard the public interest by ensuring safe food. However, health, safety and quality requirements imposed by importing markets for fish and fishery products, which have steadily increased in recent years, pose a big challenge for exports from developing countries who often find it difficult to comply with these requirements. Moreover, the stringency of SPS measures increase with each processing stage, creating further obstacles for developing countries to advance in the value chain. Therefore, there is the need to identify trade rules that protect measures that are legitimately in the public interest, without creating insurmountable barriers to trade for producers from developing countries.

Paolo Ghisu is a Junior Program Officer in the Competitiveness and Development Program of the International Centre for Trade and Sustainable Development (ICTSD).

This article refers to an ICTSD Information note by Paolo Ghisu and Moustapha Kamal Gueye, (October 2009). Climate Change and Fisheries: Policy, Trade and Sustainable Development Issues. Information Note Number 15, ICTSD, Geneva. Available at: http://www.ictsd.org/themes/natural-resources/climate-change-and-fisheries-policy-trade-and-sustainable-development

[1] See for instance Macfadyen, G., and Allison, E. (2009). Climate Change, Fisheries, Trade and Competitiveness: Understanding Impacts and Formulating Responses for Commonwealth Small States. Commonwealth Secretariat/Poseidon/WorldFish.

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